Regulatory Alerts2022-05-17
Quantitative Liquidity Requirements Guidelines for Non-bank Deposit Takers
The Reserve Bank of New Zealand issued these guidelines to provide non-binding guidance to non-bank deposit takers and trustees regarding quantitative liquidity requirements established by the 2010 Regulations. The document mandates that trust deeds include appropriate quantitative risk metrics, such as liquidity coverage and mismatch ratios, supported by robust cash flow modelling and clearly defined eligible liquid assets. It further requires entities to set metric limits based on risk tolerance determined through stress scenarios and to regularly review these metrics in light of business changes or evolving liquidity exposures.
Share